Exhibit 10.1
FINANCIAL ADVISORY AGREEMENT
----------------------------
THIS FINANCIAL
ADVISORY AGREEMENT
("Agreement")
is made and
entered
into on this the 26th day of September 2005, by and between HFG
International,
Limited, a Hong Kong corporation ("HFG"), and Eastern Nano-Materials Holdings
Limited, a company
organized under the laws of the Republic of
Singapore (the
"Company").
W I T N E S S E T H:
WHEREAS, the Company desires to engage HFG to provide certain
financial
advisory and consulting services as specifically enumerated below commencing as
of the date hereof related to the Financing, the Restructuring, the
Going Public
Transaction and the Post-Transaction Period (each as hereinafter
defined), and
HFG is willing to be so engaged;
NOW, THEREFORE,
for and in
consideration
of the covenants set
forth
herein and the mutual
benefits to be gained
by the parties hereto,
and other
good and valuable
consideration, the
receipt and adequacy of which are now and
forever acknowledged
and confessed, the
parties hereto hereby agree and intend
to be legally bound as follows:
1. Retention. As of the date hereof, the Company hereby retains and
HFG
hereby agrees to be retained as the Company's exclusive financial
advisor during
the term of this
Agreement. The Company
acknowledges
that HFG shall have
the
right to engage third parties with the Company's permission to assist it in its
efforts to satisfy its
obligations hereunder.
In its capacity as a financial
advisor to the Company, HFG will:
A. Restructuring and Going Public Transaction.
(i) consult on the implementation of a restructuring plan (the
"Restructuring")
resulting in an
organizational
structure that
will
allow the Company to complete the Going Public Transaction;
(ii) assist the Company in evaluating the manner of effecting
a going public transaction with a public shell corporation
domiciled in
the United
States of America and quoted on the "OTC BB" (a
"Going
Public Transaction") resulting in HFG, its affiliates, participants in
the Financing
and the minority shareholders of the public shell
corporation retaining
control of 5.8 percent
(5.8%) of all the issued
and outstanding stock of the public company following consummation of
the Financing
and the Going Public Transaction. The Company
acknowledges that it has presented HFG with financial projections (the
"Projections")
indicating that the
Company will report
net income of
approximately $10
million USD for the
first three quarters
of fiscal
2005 (the "Projected
NI"). The Company agrees that in the event it
fails to meet the Projected NI, HFG shall have the right,
in its sole
discretion, to renegotiate its terms.
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(iii) assist the Company in a capital raising transaction (a
"Financing") as
permitted by applicable law and in accordance with the
terms of that certain Financing Agreement (the "Financing
Agreement")
attached hereto as Exhibit "A".
B. Post Transaction Period
Upon consummation of the Going Public Transaction, HFG agrees
to:
(i) coordinate
and supervise a training program for the
purpose of
facilitating
new management's operation of the public
company;
(ii) if necessary, facilitate the preparation of an
information statement
to be filed
with the SEC to change
the public
company's name and to
in turn assist in
obtaining a new CUSIP
number
and stock symbol for the public company;
(iii) assist
in developing and implementing the public
company's investor
relations
efforts,
which
shall include (a)
establishing a program for communicating with brokerage
professionals,
investment bankers and
market makers; (b) creating a complete investor
relations strategy to
be implemented in
English and Chinese;
and (c)
assisting in the preparation and dissemination of press releases (the
Company agrees
that all costs and expenses charged by investor
relations and press
relations firms
introduced by HFG and
engaged by
the public
company will be the sole responsibility of the public
company);
(iv) provide
assistance and guidance in the preparation and
assembly of
application
materials for the listing of the public
company's common stock on a national exchange or quotation medium
that
shall necessarily
be limited to the
American Stock Exchange or the
NASDAQ Stock Market; and
(v) provide the public company with such additional financial
advisory services as may be reasonably requested, to the extent HFG
has
the expertise or legal right to render such services.
2. Authorization.
Subject
to the terms and conditions of this
Agreement, the Company hereby appoints HFG to act on a best efforts
basis as its
consultant during the Authorization Period (as hereinafter
defined). HFG
hereby
accepts such appoint, with it being expressly acknowledged that HFG
is acting in
the capacity of
independent contractor
and not as agent of either the Company,
affiliates of the
Company resulting from the Restructuring, or the public
company.
In
addition, except in
the event of an act constituting either willful
misconduct or gross
negligence on the part
of HFG, the Company
agrees that it
will not hold HFG
responsible in the event that either the Restructuring, the
Financing or the Going Public Transaction is not consummated,
nor shall it hold
HFG liable for any damages suffered by the Company as a
result of the Company's
inability to
consummate either the
Restructuring,
the Financing or the
Going
Public Transaction. It
is expressly
acknowledged by the Company that HFG shall
not render legal or
accounting
advice in connection with the services to be
provided herein. HFG
shall have the right to recommend the legal and accounting
professionals for the transactions contemplated herein.
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3. Authorization
Period. HFG's engagement hereunder shall become
effective on the date
hereof (the
